Why Systems Thinking Makes You Smarter

Posted on August 6, 2011 by Kerry Stackpole

When it comes to understanding risk and the complexity of change and decision, looking carefully at systems thinking and systems theory can offer a valuable framework for understanding. Working from this framework offers the opportunity to examine your decision-making in the context of the whole system, recurring patterns and their relationship to sub-systems in motion throughout the organization.

How many times have you or someone in your department made a decision only to discover that while you have successfully solved the problem, the decision has created an entirely different set of problems for someone else, another department or the organization at large?

System thinking encourages you to view your organization systems from a broad perspective including overall structures, patterns and cycles, rather than seeing only specific events. Doing so oftentimes helps quickly identify the real causes of risk in your organization. How one chooses to apply remedies is key to avoiding failure. Systems thinking focuses on the entire system, helping you work to identify solutions that address as many problems as possible throughout your organization. The effect of those solutions is that they leverage improvement throughout the system.

When it comes to personal decision-making another sort of system is in play and it too relies on a broader understanding of your own experiences, preferences and biases. When we make day-to-day choices, most everyone utilizes two types or systems of thinking.

System 1 Thinking – That’s our most intuitive form of thinking. We use it unconsciously in most cases and we rely on it to guide us through much of our day. This approach relies on “rules of thumb”, experience (known in their origin as mistakes) and “gut instinct” among other habits.

System 2 Thinking – This is our slower, more conscious, effortful, and logical means of thinking. When you are carefully considering options, you are using System 2 thinking.
One of the greatest challenges busy people, especially managers and leaders face is the tendency or habit of falling back on Systems 1 thinking, when a Systems 2 analysis would really be far more productive and beneficial.

When you consider your day-to-day life, which system do you rely upon more and why? Given how smart you already are, it’s definitely worth thinking about.

You are reading Why Systems Thinking Makes You Smarter on the Wired 4 Leadership Blog written by Kerry Stackpole. For more information, contact Kerry at kerry@kerrystackpole.com

Posted in Change, Executive Development, Leadership | Leave a comment

The Decision Tree

Posted on July 28, 2011 by Kerry Stackpole

There are challenging moments in every organization that most oftentimes arise surrounding the decision-making process.  Do we have enough data?  What do our members/customers/clients think?  Have we thoroughly tested our idea?  What don’t we know?  As the old adage goes, “where you stand, depends directly on where you sit.”  Each of us comes to the decision making process with our own experiences, bias and expectations.   Assuming you were raised in a democratic society, the deep-seated belief that you have a right to be heard might be one of your unconscious biases.  There are dozens of other hidden biases that if left unexplored seed the ground for potential trouble.

Each of us makes dozens and dozens of decisions every day.  It is easy to become complacent and overlook the incredibly complex dynamic that underlies each one.  Many of our daily decisions are intuitive in nature—an apple is healthier than a candy bar—for instance.  The interstate highway is slower in rush hour than surface streets.  Revenues must exceed expenses to generate a profit.  Our world is full of heuristics or “rules” by which we operate.  What are some of your own personal heuristics?

To combat natural biases in decision-making many organizations have expanded beyond mission and value statements to craft guiding principles intended to shape and influence individual and group decision-making.

The head of the $6.9 billion dollar Australian firm LendLease a leading retail and international property group under the leadership of Stuart Hornery did so in some extraordinary ways in the late 1990’s.  Hornery put a sharp point on the effort saying “if guiding principles are genuinely held and practiced throughout the company will attract the best people to work for us, the quality of our work will attract the attention of customers, demand for our services will grow, and our global family will prosper—all of which contributes to delivering superior value for our shareholders.”

  • Dare to be different in everything we do—the enemy of mediocrity.
  • Never do anything that would diminish the pride our parents have in us.
  • No nasty surprises—grow earnings every year.
  • Be a leading employer.
  • Enhance the environment.
  • We need special relationships to enhance our capabilities.
  • No individual has a monopoly on good ideas.
  • We will only prosper with the support of the communities with which we interact.
  • We wish all employees to be shareholders
  • We believe there is a strong link between good governance and performance.

While every organization does not have shareholders per se—we clearly we do have stakeholders.  Members, customers, legislators, regulators, and the communities we serve. All demand our greatest efforts and deserve the delivery of superior value.  How’s your decision making that happen?

Posted in Executive Development, Leadership | Leave a comment

The Accidental Classroom

Posted on March 26, 2011 by Kerry Stackpole

Let’s be honest, you’ve got plenty on your plate already–maybe it’s overflowing. Everyday there are greater demands for your time, association resources, and improved outcomes in all that your organization seeks to achieve on behalf of the membership. That’s exactly why you should want innovation at the center of your plate. Really stupid idea, you say? Don’t be so sure.

Part of the opportunity that underlies the work of association leaders is the opportunity to extrapolate from history, experience, and current events what the future might hold for our organizations. Ultimately and more importantly of course is applying those hypotheses to your organization by creating a new product or service or establishing an entirely new, more competitive position. In a word, innovating.

In his 2005 commencement speech at Stanford University, Apple Co-Founder Steve Jobs described his life as a college dropout. “Because I had dropped out and didn’t have to take the normal classes, I decided to take a calligraphy class. I learned about serif and san serif typefaces, about varying the amount of space between different letter combinations, about what makes great typography great. It was beautiful, historical, artistically subtle in a way that science can’t capture, and I found it fascinating. None of this had even a hope of any practical application in my life.

“Ten years later, when we were designing the first Macintosh computer, it all came back to me. And we designed it all into the Mac. It was the first computer with beautiful typography. If I had never dropped in on that single course in college, the Mac would have never had multiple typefaces or proportionally spaced fonts. And since Windows just copied the Mac, it’s likely that no personal computer would have them. If I had never dropped out, I would have never dropped in on this calligraphy class, and personal computers might not have the wonderful typography that they do.”

With that as backdrop consider one of this country’s grand old organizations. The International Typographers Union (ITU) beginnings dated back to the 1850′s. The member’s were craftsmen who set wood block and metal type by hand. Publishing in all forms flourished through the growing use of machine type and the launch of photocomposition in the 1960s. While the move to photocomposition was viewed mostly as an evolutionary change, in fact, it was revolutionary.

With a membership of over 121,000 typographers in 1964, the ITU was a powerful part of the labor force. Twenty-two years later they ceased to exist. The age of craft typography had come to an end, thanks in part to Steve Jobs and that accidental calligraphy class. What remained of the ITU was absorbed by the Communication Workers of America Printing, Publishing, and Media Workers Sector led by the man who is now the Public Printer of the United States, William J. Boarman.

It is a cautionary and parallel tale for many associations, professions and industries today. Revolutionary information technology is competing to capture market share from what were once the exclusive domain of associations and organizations in a diverse array of markets.

As leaders we are being challenged everyday by new technologies, content delivery systems, and new business methods that chip away at our organization’s core value. While some of the early competition or technology-based efforts have fallen short or failed miserably, there is little reason to take comfort. These are the seeds of the future. So as a leader here’s the question you need to consider now: If your association or organization went out of business today, who would miss you and why? It should be a simple question, but given serious consideration it is not so simple. Creating an innovation pathway to deliver the future is about answering this question and others more fully and with fresh zeal. How to get started? You might consider making that trip to an accidental classroom near you.

Posted in Change, Innovation, Leadership | Leave a comment

Winning Hearts Through Enchantment

Posted on March 7, 2011 by Kerry Stackpole

Bestselling business guru Guy Kawasaki sent me his new book Enchantment the other day.  I’ve just started my read and will gladly share my thoughts with you as we go along.  As leaders we are constantly under pressure to move things along.  In this book Kawasaki argues that in business and personal interactions, your goal is not merely to get what you want but to bring about a voluntary, enduring, and delightful change in other people. By enlisting their own goals and desires, by being likable and trustworthy, and by framing a cause that others can embrace, you can change hearts, minds, and actions. Not necessarily fresh ground, but incredibly fertile fields for achieving leadership success with both staff and Boards.

Last thing and you need to hurry. Until Midnight PST tonight you can buy a new copy of Enchantment and get a FREE copy of Kawasaki’s previous book, Reality Check. The offer is only good in the United States.  To be clear, I do not benefit in any way directly or indirectly from your purchase.  I’m just passing along the offer.  Here’s the link: Enchantment and Reality Check

Posted in Change, Executive Development, Governance, Innovation, Leadership | Leave a comment

40 Seconds To Failure…or Is It Success?

Posted on February 13, 2011 by Kerry Stackpole

Innovation is defined as the introduction of something new—a new idea, method or device. The Economist Magazine playing off an ancient joke asked, “How long does it take to change a light bulb?” The answer was 136 years—the time it has taken civilization to move from filament based illumination to new compact fluorescent light bulbs (CFL). Filament light bulbs are notoriously wasteful. They give off 95% of their energy as heat, not light, which in the summer season or in warmer climates means cooling costs are higher too. You can see the cycle. All this attention to lighting has also increased research into a whole range of new lighting methods including non-mercury plasma light bulbs, and light emitting diodes (LEDs).

It is a larger scale problem for leaders. Which innovation does one embrace? In a world of increasingly scarce resources, organization leaders are faced with a dizzying array of choices. Cloud computing or proprietary databases? iPad formatted publications or Android? Web-based applications or shrink wrapped licensed software? LEDs or CFLs? Work harder or work faster? Increasingly, leaders live in the “and” world, not the “or” world. As in, we need to support iPad and Android and Kindle. Mac OS-X and Windows 7. We need to print and we need to deliver digitally. Embracing an increasingly complex and divergent population requires laser-like focus on getting the essentials right. Our fear of missing the next great leap forward propels us, our customers, clients and members toward early adoption of all means of innovation. All at a price.

That’s not as bad as it sounds. Increasingly, our organizations can experiment with new ideas and innovations for free. Chris Anderson‘s intriguing hypothesis captured in his book FREE: The Future of a Radical Price makes the point that this opportunity comes from a unique happenstance—the movement from atoms to bits. The cost of bits—the online world as we know it—is increasingly free. When one bit of online software falls by the wayside, a new improved application can be found. It’s a point reinforced by entrepreneur Cameron Herold during his presentation this past year at ASAE 2010. Herold says he doesn’t worry and doesn’t think any of us need be concerned about the business model of online entrepreneurs or whether they make any money from their free applications. Free can be replaced by a better “free”.

The conundrum for leaders is they are responsible for the profitable operation of the enterprise. Not to put too sharp an edge on it, but could Gillette have risen to greatness selling shaving cream as a profit-center in place of razor blades? Could Microsoft have amassed billions and created wealth by giving away DOS or Windows OS? We’ll never know the answer. We do know the actual cost of delivering Microsoft Word to your desktop today as a download is miniscule. But what if your enterprise was built on controlling access, limiting distribution and constraining community to only those willing to pay an admission fee to get past the gate? Across the spectrum publishing organizations, associations, specialized information sellers, magazines, distribution companies, content producers, music labels, newspapers and movie studios all face the unending question of how to re-work their respective business models and craft workable innovations to sustain the value of creation while attracting and retaining customers. Leaders face a bold new responsibility for building new clarity about the goal of innovation. Is our goal to eliminate waste? To get our products and services to free? Or is it the cheapest possible distribution channel and the lowest possible price point? Or something else altogether? On today’s innovation frontier the difference between success and failure is fleeting.

Posted in Change, Executive Development, Innovation, Leadership | Leave a comment

The Future. Until It Isn’t.

Posted on January 30, 2011 by Kerry Stackpole

Part of the opportunity that underlies the work of leaders is the opportunity to observe, consider and extrapolate from history, experience and current events a glimpse of what the future might hold for our organizations.  Ultimately and more importantly of course is applying that hypothesis to your business or organization by creating a new product, service or establishing a new, more competitive position.

With that as backdrop we began wondering about some of this country’s grand old organizations, like the International Typographers Union (ITU).  Its beginnings date back to the 1850′s, when a group of 18 or so men gathered to establish an organization to represent the growing interests and needs of typographers in the rapidly growing field.  The business of typography for those not familiar with the medium is fascinating.  If you wonder just how type influences our society, take a look at the illuminating and award winning documentary Helvetica by Gary Hustwit.   From the days of setting wood block type and eventually metal type by hand, through the use of molten lead to the launch of photocomposition or computerized type in the 1960′s, typography has influenced all means of communication.  The move to photocomposition was viewed as evolutionary, but in fact was revolutionary to the industry.

The ITU had a membership over 121,000 typographers in 1964.  By 1986, just twenty-two years later the ITU as most members knew it, ceased to exist.  Typographers sought to apply their experience to other positions within the printing industry or changed careers altogether.  What remained of the ITU was absorbed by the Communication Workers of America Printing, Publishing, and Media Workers Sector led by the man who is now the Public Printer of the United States, William J. Boarman.

It is a cautionary and parallel tale for many industries today.  Revolutionary information technology is competing to capture market share from what were once the exclusive domain of businesses and organizations in a diverse array of markets. As leaders we are being challenged everyday by these new technologies, content delivery mediums and business methods.  While some of these early technology based efforts have fallen short or failed miserably, there is no reason to take comfort.  These are the seeds of the future.

So as a leader, here’s a question you need to consider now.  If your business or organization went out of business today, who would miss you and why?  It’s not a simple question and finding the answer will make all the difference to the seeds of your future.

Posted in Change, Executive Development, Leadership | 1 Comment

As 2010 comes to a close all means of the “Best of” lists are certain to arise in your favorite circles.  Whether it’s best ice cream flavors, green idea, news stories, remixes, political figures, hospitals, celebrities, musicians, Internet trends, automobiles or my personal favorite books, the lists will surely arrive.  To get you in the mood our friends at Booz & Company’s Strategy + Business magazine have delivered their 2010 Best Business Books list (slightly ahead of the holidays—just sayin’)  Here’s are the nominees:

Slapped By The Invisible Hand: The Panic of 2007 – Gary B. Gordon
Chasing Stars: The Myth of Talent and the Portability of Performance – Boris Groysberg
Reflections on Leadership and Career Development – Manfred F.R. Ket de Vries
Denial: Why Business Leaders Fail to Look Facts in the Face – Richard S. Tedlow
Where Good Ideas Come From: The Natural History of Innovation – Steven Johnson
The Power of Positive Deviance – Richard T. Pascale et. al.
Country Driving – Peter Hessler
Last Call: The Rise and Fall of Prohibition – Daniel Okrent

A wide ranging group of other authors get a nod including Charlene Li’s Open Leadership: How Social Technology Can Transform The Way You Lead; Clay Shirky’s Cognitive Surplus: Creativity and Generosity in a Connected Age; Hagel, Brown and Davison’s The Power of Pull; Jody Heymann’s Profit at the Bottom of the Ladder; Dan Pink’s wonderful Drive: The Surprising Truth About What Motivates Us; The Heath Brother’s Switch: How to Change Things When Change Is Hard; and from one of my favorite management thinkers Warren Bennis, Still Surprised: A Memoir of a Life in Leadership.

Undoubtedly, you have your own favorites or “best” choice for 2010 don’t you?  Share your favorites by adding a comment or two.  I’ll come back to update the listing a little bit later.  Stay tuned.  Here’s wishing you another rich bounty of great reading in 2011.

Posted on November 23, 2010 by kerstack | Leave a comment

Bouncing Back

Posted on November 9, 2010 by Kerry Stackpole

In every defeat and in every failure are the seeds of greatness.  It is less about what happens to you as a leader than what you do with what happens that matters.  Great leaders are resilient and know how to adjust quickly in the face of adversity.

When faced with hardship it is not uncommon to find yourself in denial or disbelief. You may find yourself wondering less about how to get out the situation and more about how you got into it in the first place just like US Airways pilot Captain Chesley “Sully” Sullenberger.  Celebrated for his coolness in ditching an Airbus 320 in the Hudson River following a bird strike, Sullenberger has shared a critical observation, “…everything I had done in my career,” he said, “had in some way been a preparation for that moment.”

Preparing for both success and failure fuels your ability as a leader to bounce back quickly and to bring order to difficult circumstances.  Understanding failure creates the essential framework for successful change and innovation. But if not managed correctly, it can create doubt, damage self-esteem and cripple your leadership skills.

The Road to Resilience a white paper produced by the American Psychological Association identifies six essential steps to maintaining your resilience as a person and as a leader.  They include: taking decisive actions; looking for opportunities for self-discovery; nurturing a positive view of yourself; keeping things in perspective; maintaining a hopeful outlook and taking care of yourself.

Remember you chose leadership for a reason.  As “Sully” Sullenberger reminds us, “…people are best served when they find their passion early on, because we tend to be good at things we’re passionate about.”  Get back in the game. Now!

Posted in Leadership | Tagged , , , , , , , , , , | 2 Comments

That Angry Moment.

Posted on November 4, 2010 by Kerry Stackpole

American voters had their angry moment this week.  They turned the U.S. House of Representatives over to the Republican Party.  It was an object lesson in the failure of leadership.  This was not a partisan moment.  It was a moment of supreme despair and frustration.  If the blameworthy Republicans drove the car into the ditch—as President Obama said so often on the campaign trail—it became his administration’s failure to get it out of the ditch and back on the road to jobs that doomed Democrats in the mid-term elections.  Nobody can argue the ditch wasn’t deep or that economic traction was illusive. Some like Eugene Robinson of the Washington Post saw voter’s behavior as irrational.  In his editorial The Spoiled-brat American Electorate Robinson wrote “The American people are acting like a bunch of spoiled brats.”  When it comes to the massive challenges facing our nation he writes, “They want somebody to make it all better. Now.”  Patience it seems is not on the national menu.  Frustration, well that’s another matter.

Whenever either political party has held the full majority in both houses of Congress, they have more often than not failed to hear the electorate, ridden rough-shod over their opponents, filibustered one another’s efforts and in the end violated the inherent privileges of leadership.  Simply put, every leader gets paid for results. Period. When individuals believe their sole purpose is to obstruct the other side’s plans, they forfeit their right to lead, violating the most basic tenets of trust, teamwork and responsibility of calling people to service along the way.

That’s also what makes it such a critical cautionary tale.  If so many capable and talented politicians can blindly stumble into this leadership maelstrom, how can we possibly avoid it?  Sure it’s a punchline to an easy joke, but it’s also a daunting question all leaders need to consider.  History is replete with leaders who have gotten it so very wrong and thankfully a few so very right.  Perspective in these matters is easily worth a 100 IQ points.

Posted in Change, Leadership | Tagged , , , , , , , , , , , | 1 Comment

The Big Lie

Posted on November 1, 2010 by Kerry Stackpole

“We have now got both parties essentially telling a big lie. With a capital ‘B’ and a capital ‘L’ to the public: and that is that we can have all this government, 24 percent of GDP, this huge entitlement program, all of the bailouts. And yet, we don’t have to tax ourselves and pay our bills. That’s delusional.” So said President Ronald Reagan’s Former Budget Director David Stockman in a shockingly candid interview with CBS’ 60 Minutes correspondent Lesley Stahl.

 

When asked why he was calling for the elimination of the Bush-era tax cuts,  Stockman said, “Well, we just can’t afford them. We couldn’t afford them when they were adopted in 2001 and 2003.  Since then, we’ve had two giant unfinanced wars, a huge bailout of Wall Street. This trillion-dollar stimulus program, and we have now created so much national debt, and such large permanent deficits that we’re going to have to do some very difficult and painful things to close the gap…”

Stockman, who masterminded one of the nation’s biggest tax cuts under President Ronald Reagan made a startling point, “In 1985, the top five percent of the households, wealthiest five percent, had net worth of $8 trillion, which is a lot.  Today, after serial bubble after serial bubble, the top five percent have net worth of $40 trillion,” he explained. ”The top five percent have gained more wealth than the whole human race had created prior to 1980.”

The notion that somehow the American economy will dig itself out of the enormous economic hole dug by Republicans and Democrats alike without a significant tax increase for rich and poor seems increasingly unlikely.  In fact, Stockman pointed that a one-time 15% surtax on American’s richest citizens could cut the deficit in half in a single year.  Where there is political will there is a way.

Posted in Governance, Leadership, Politics | Tagged , , , , , , , , | 1 Comment